Updated almost 17 years ago on . Most recent reply
Cash Back at Closing -Short Sale
Hello, quick question to all the EXPERTS out there...I was approached, on my own residential property, by a Realtor, who was showing a client a short sale across the street. When the Realtor got to speaking to my husband, he realized that we were also in a Foreclosure situation, and that we're going through a loan mod. Well, next thing I know, this guy sends us an offer, for about $25k less than the neighbors short sale price ($425k), with $25k BACK ....TO US????!!!! Is such an offer even ethical? Can it be done? We were going to hold the property as a rental, but wouldn't mind getting a lump sum in cash in return (to invest elsewhere) if we could.
Thanks for anyone's expert opinion in this.
BTW, I just spoke to an investor this weekend, someone from American Investors Network (Jim Shead's group) who said it could possibly be done, if done right.
Most Popular Reply
The short answer is YES, it is truly unethical and probably illegal. It is also a hook to get you on the line. After sometime, he will tell you things like: Sorry but the number did not line up, or the lender would not allow you to receive proceeds.
Truth is, one of the requirements for a short sale to close is that you agree you are not receiving proceeds from the sale. In many cases, your are required to sign a document saying that your not receiving any monies and if the lender finds out to the contrary, you could be prosecuted for fraud.
Bottom line, this investor is shady and cannot be trusted. Whether it can be done or not is irrelevant. If you sign an agreement that you are not being compensated, could end up in jail if caught. These days, there are more eyes on us investors than ever before and I personally would advise you to run away from this guy. If he indeed does bribe homeowners, he could already be under investigation or worse.
Is it really worth the risk?